CII favours short-term protection of steel industry

Kolkata, Aug 23 (PTI) A temporary protection of the Indiansteel industry against cheap Chinese imports is acceptable butin the long run the country is cable enough of competing withits global peers, an industry body said today. "If protection is temporary, it is acceptable. In thelong term it (country) has to do away with the protections,"CII president Naushad Forbes said here today in a mediainteraction. He was replying to a question on protection sought bythe Indian steel industry against Chinese dumping. The Indiangovernment has imposed protection in the form of safeguardduty and minimum import price. Forbes justified protective tariff for the steel industryin the ‘short run’ to make it competitive locally. However, hesaid protection results in consumers paying higher cost ofgoods. Tata Steel India head and CII regional chairman T VNarendran also pointed that the domestic steel industry wasnot unique in seeking protection and in the medium to longterm there is no problem and it (Indian steel industry) cancompete as it has always competed. "India is not unique and everyone in the world is takingaction. It is normal. Anti-dumping takes time and for thattemporary measures are taken. Eventually, whatever is WTOcomplied duty, is justified. We do not see in the long term,"Narendran said. He further said: "Nobody was speaking on protection beforeJanuary with 0 to 5 per cent import duty. There is a suddenproblem in China. Should you protect investors buildingcapacity and when you are promoting make in India?" On GST, he said, the maximum rate of around 18 per centwould be fine. "GST rate at 18 per cent would be a good revenue neutralrate. And it would not be so high that it would damagethe consumption of goods, markets for goods and beinflationary," Forbes said. He said this would lead to an increased collection oftaxes. It is the right rate from consumption and long termtax buoyancy in collection. Forbes hoped that investment cycle should begin byyear-end after a lull of five years. Fresh investment from the private sector was not pickingup due to slowdown and over capacity, he said. PTI BSM MDANU